Standardizing license years, due dates, class schedules and other elements of the business licensing process, the SC Business License Standardization Act, also known as Act 176, creates many new requirements for cities and towns to help make doing business around the state easier. Part of the way that municipalities can make sure that they are fulfilling all of the new law’s requirements is by adopting the 2022 version of the model business license ordinance.
This version of the model ordinance represents a complete overhaul of past versions. Municipal Association of SC staff and several attorneys carefully researched the new model ordinance to address the requirements of Act 176. Cities and towns that passed any earlier version of the model ordinance, including the version released for 2019 before the new law’s passage, will have outdated ordinances beginning in 2022.
The Municipal Association strongly encourages city and town councils to avoid redlining and altering their existing ordinances. The complexities of Act 176 make repealing the existing ordinance and replacing it with the 2022 model ordinance a better option to avoid missing any of the specific requirements.
Provisions of the 2022 ordinance
The new model ordinance provides the current standard class schedule, required by Act 176. Model ordinances in future years will update the class schedule as needed. The 2022 ordinance also includes the standard definition of a business’s gross income, as required by the law.
The model ordinance addresses many commons elements of business license operations:
- The ordinance’s applicability to those businesses without an established location inside the municipality
- Requirements for businesses to display a license, or sellers to carry a license
- Penalties for nonpayment
- Denials, suspensions and revocation of licenses
Preparing for the model ordinance
The Association has created a seven-step process to help cities and towns comply with all aspects of Act 176, with each step building on the previous steps. Repealing and replacing the ordinance comes as Step 5 in the compliance process. Before adopting the ordinance, officials should complete earlier steps such as converting to the standard license year and class schedule, and rebalancing rates. For those who have not already completed Steps 1 through 4, time is quickly running out, and immediate action is required. Learn more about the process.
The Association is releasing a copy of the 2022 model ordinance to each city or town upon request. After a municipality has completed the earlier steps for a standard license year transition and begun the process of rebalancing tax rates as required by the law, it should contact Melissa Harrill, research and legislative liaison, at email@example.com for a copy of the 2022 model ordinance.